With rent asking prices in London
on the rise, seemingly out of control, going up pretty quickly due to low stock levels, is it now a good time to invest in property again?
Buy to Let mortgage products appear to be more attractive now, and lenders such as The Mortgage Works offering reasonable fixed rates at the 75% loan to value point with fixed arrangements fees, and some products even having no arrangement fee.
So what might appeal to an investor?
Gross yield – Will the investor get a better return than the bank or other investments. Check out SE23 – London Forest Hill, as according to the FT it’s one of London’s best performing locations.
Risk – Is the property in an area earmarked for improvement – one where property values are likely to increase or just as importantly less likely to decrease
Location – Is the physical location attractive (for example being very near to a town centre and local travel connections) and therefore likely to find tenants quickly and without experiencing rental void periods in the future?
This article provides some good ideas for locations
Check these out for rental yields:
Property one – (2 bed flat in SE19) Expected rent £1275 per month = Gross rental yield of 7.6%
Property two – (Commercial shop in SW16) Actual rent £40,000 per annum = Gross rental yield 0f 8.4%
Property three – (1 bed flat in BR1) Expected rent of £850pcm = Gross rental yield of 7.8%